As you might know, Tianqi Lithium Corporation (SZSE:002466) last week released its latest quarterly, and things did not turn out so great for shareholders. Unfortunately, Tianqi Lithium delivered a serious earnings miss. Revenues of CN¥8.6b were 17% below expectations, and statutory earnings per share of CN¥1.00 missed estimates by 25%. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Tianqi Lithium after the latest results.
View our latest analysis for Tianqi Lithium
Taking into account the latest results, the current consensus, from the 16 analysts covering Tianqi Lithium, is for revenues of CN¥33.2b in 2024. This implies a stressful 32% reduction in Tianqi Lithium's revenue over the past 12 months. Statutory earnings per share are forecast to plummet 23% to CN¥7.59 in the same period. Before this earnings report, the analysts had been forecasting revenues of CN¥33.5b and earnings per share (EPS) of CN¥7.70 in 2024. So it's pretty clear that, although the analysts have updated their estimates, there's been no major change in expectations for the business following the latest results.
It will come as no surprise then, to learn that the consensus price target is largely unchanged at CN¥80.58. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. Currently, the most bullish analyst values Tianqi Lithium at CN¥120 per share, while the most bearish prices it at CN¥45.40. Note the wide gap in analyst price targets? This implies to us that there is a fairly broad range of possible scenarios for the underlying business.
Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. We would highlight that revenue is expected to reverse, with a forecast 27% annualised decline to the end of 2024. That is a notable change from historical growth of 57% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue grow 19% annually for the foreseeable future. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - Tianqi Lithium is expected to lag the wider industry.
The Bottom Line
The most important thing to take away is that there's been no major change in sentiment, with the analysts reconfirming that the business is performing in line with their previous earnings per share estimates. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that Tianqi Lithium's revenue is expected to perform worse than the wider industry. The consensus price target held steady at CN¥80.58, with the latest estimates not enough to have an impact on their price targets.
Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. At Simply Wall St, we have a full range of analyst estimates for Tianqi Lithium going out to 2025, and you can see them free on our platform here..
It is also worth noting that we have found 3 warning signs for Tianqi Lithium (1 is significant!) that you need to take into consideration.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.